IE 11 is not supported. For an optimal experience visit our site on another browser.

As gas prices climb, more Britons take bus

As Americans contemplate the misery of a summer of $3-per-gallon gas, drivers in Britain and much of continental Europe look on with resigned envy. There, gas is approaching $7 a gallon.
David Graham, a 48-year-old building contractor, is selling his SUV because of high fuel costs.
David Graham, a 48-year-old building contractor, is selling his SUV because of high fuel costs.Kevin Sullivan / Washington Post
/ Source: a href="" linktype="External" resizable="true" status="true" scrollbars="true">The Washington Post</a

David Graham pulled up to the gas pump in his shiny black sport-utility vehicle with a "for sale" sign taped in the window.

Graham, 48, a London building contractor, pointed at the price on the pump -- the equivalent of $6.62 a gallon, which means it costs him $125 to fill his tank. "That's why this is for sale," Graham said. "I can't afford it anymore. I have to walk everywhere. Things have gone mad."

As Americans contemplate the misery of a summer of $3-per-gallon gas, drivers in Britain and much of continental Europe look on with resigned envy. High taxes long ago created some of the world's most expensive gasoline on this side of the Atlantic, where a family car is deemed more a luxury than a necessity and many people rely instead on extensive public transportation networks.

But even in Europe, where consumers are used to paying pump prices double, or more, what Americans pay, there is growing alarm over the effect of rising crude oil prices on fuel costs.

Many motorists are driving less and altering the way they shop, take vacations and carry out other routines, according to interviews and opinion polls. Many airlines, delivery services and other fuel-dependent businesses are either passing increases on to consumers through higher prices or taking deep profit cuts.

Andris Piebalgs, the European Union's energy commissioner, warned last weekend that high oil prices were "destroying economic growth" in Europe.

Kate Gibbs of Britain's Road Haulage Association, which represents truckers and trucking companies, said the prices were driving many small trucking companies out of business. "They just can't take it anymore," Gibbs said.

Uncertainty about the West's growing confrontation with Iran, the world's fourth-largest oil supplier, instability in major producers such as Nigeria and Iraq, continued fallout from Hurricane Katrina, and growing demand for oil in China and India are among the reasons analysts cite for the worldwide surge in pump prices.

Drivers in 11 European countries are now paying an average of more than $6 a gallon for gasoline, according to Britain's AA Motoring Trust. "We have always looked upon you Americans with a lot of envy" about gas prices, said David Williams of the trust, an independent research group that advocates for British motorists.

Taxes a policy tool
European governments have long used gasoline taxes not only as an important source of revenue, but as a policy tool to drive down oil consumption and reduce pollution.

Williams said taxes account for about 66 percent of the pump price in Britain -- so of the current average price per gallon of $6.48, about $4.27 goes to the government.

U.S. drivers pay an average of about 46 cents per gallon in combined state, federal and local taxes, according to the Tax Foundation, an independent organization in Washington.

"We would like to see zero fuel duties, of course," Williams said. "But we have to put our hands on our hearts and admit that the government needs money for all kinds of things, and this is one way to get it. People do want their schools and hospitals to be better, so this is just practical politics."

Six years ago, when government taxes represented an even larger share of fuel costs, truckers, taxi drivers and other protesters blockaded Britain's oil refineries and storage depots to stop delivery to gas stations. The weeklong strike nearly paralyzed the country.

British government officials said that in an effort to help consumers, they had frozen the primary tax on gasoline since 2003. It has remained at 47.1 pence per liter -- about $3.17 per gallon at today's exchange rates. On top of that duty, consumers also pay a 17.5 percent consumption tax.

In his 2006 budget, announced last month, Gordon Brown, Britain's finance minister, continued the freeze until at least September.

"The government doesn't believe in temporary measures," said a Treasury spokesman, speaking on condition of anonymity following standard practice here. "As soon as you start making decisions based on short-term fluctuations in the market, you take yourself out of a stable situation."

In the Netherlands, gas is selling for about $6.16 per gallon, which includes $3.10 in duty and 19 percent sales tax, said Jelle Wils, spokesman for the Ministry of Economic Affairs. Wils said the government had held "heavy discussions" about tax cuts and other relief measures for consumers but decided not to interfere with market forces.

"We cannot do anything about these prices because they are market prices," Wils said.

‘It’s extortion’
But consumer anger is clearly growing. "It's extortion, " said Alan Pirrie, 54, an industrial cleaner who lives near Coventry and drives 100 miles to London and 100 miles home six days a week -- 1,200 miles a week.

Pirrie said it costs him almost $120 to fill the tank of his small Fiat van, and he has to fill up three times a week. "Of course they should cut the tax, but there's no chance," said Pirrie, who said he and other drivers expected prices to continue rising. "It's life."

The average gasoline price in Britain has risen 19 percent since January 2005. Many stations are charging well above the $6.48 national average; at least one in London's chic Chelsea neighborhood was charging nearly $8 a gallon last weekend.

"It's disgusting," said Elizabeth Jones, 50, a pharmacy assistant, who was pumping $40 worth of gas -- for half a tank -- into her little Ford Fiesta in a working-class neighborhood in west London.

Jones said she now takes the bus to the grocery store instead of driving. She and her husband sold their second car because they couldn't afford to fill two tanks.

Alan Skitt, driving a small Renault Kangaroo van in Poplar, a modest neighborhood in London's East End, called the price increases "awful." He blamed President Bush, contending that the Iraq war had contributed significantly to the volatility in the price of oil.

"It's mad, isn't it?" said Heidi Alley, who was driving her compact Ford in Poplar. She said 10 pounds -- about $18 -- worth of gasoline used to last her four days, but now lasts only three. "I've got to run round with the kids. Either you pay it or you're walking."

Special correspondent Alexandra Topping contributed to this report.